To become an accredited investor the (SEC) requires certain wealth, income or knowledge requirements. The investor must fall into one of three categories. Firms selling unregistered securities must put investors through their own screening process to determine if investors can be considered an accredited investor.
The Verifying Individual or Entity should take reasonable steps to verify and determined that an Investor is an "accredited investor" as such term is defined in Rule 501 of the Securities Act, and hereby provides written confirmation. This letter serves to help the Entity determine status.
Utah Accredited Investor Suitability refers to the set of guidelines and regulations governing investment opportunities available only to accredited investors in the state of Utah. Accredited investors are individuals or entities that meet specific requirements set by securities laws in order to participate in certain investment offerings that are typically deemed riskier or more sophisticated. One type of Utah Accredited Investor Suitability is based on the criteria set by the Securities and Exchange Commission (SEC), known as the SEC definition. According to SEC rules, an accredited investor includes individuals who have an annual income exceeding $200,000 (or $300,000 for joint income with a spouse) for the past two years and a reasonable expectation of reaching the same income level in the current year. Additionally, individuals with a net worth exceeding $1 million, either alone or together with a spouse, excluding the value of their primary residence, can also qualify as accredited investors. Utah also allows for other types of accredited investor suitability, such as the Utah 4(2) Accredited Investor Exemption and the Utah Crowdfunding Exemption. The Utah 4(2) Accredited Investor Exemption applies to offerings made to a limited number of sophisticated investors who have sufficient knowledge and experience in financial and business matters to evaluate the investment. This exemption allows issuers to bypass certain SEC registration requirements when dealing with accredited investors in Utah. On the other hand, the Utah Crowdfunding Exemption provides an opportunity for intrastate businesses to raise capital through online platforms from both accredited and non-accredited Utah investors. This exemption implements specific investor limits, investment caps, and disclosure requirements to ensure adequate investor protection. Utah Accredited Investor Suitability aims to strike a balance between providing qualified investors with access to potentially lucrative investment opportunities while safeguarding unsophisticated investors from the risks associated with such investments. It is crucial for individuals and entities to understand and comply with the specified criteria and exemptions to ensure their eligibility for participating in investment offerings reserved for accredited investors in Utah.
